Stock Swindlers Sentenced

Author Tom Clancy Lost $1.7 Million

FOR IMMEDIATE RELEASE:
April 14, 2000

Attorney General J. Joseph Curran, Jr. announced today the sentencing of two individuals in a multi-million dollar Ponzi scheme that listed among its victims author and Baltimore Orioles minority owner, Tom Clancy. Edward Pereira, 35, and Jeffrey Goodman, 47, were sentenced on their previous pleas of guilty to multiple counts of conspiracy and stock fraud by the Honorable G. R. Hovey Johnson. Pereira was sentenced to three years in prison, all but six months suspended, to be served at the Prince George's County Detention Center, and fined $10,000, all but $3500 suspended, to be paid over a period of three years probation. Goodman's sentence was suspended to probation. Richard Scott, 54, who is terminally ill, will appear for sentencing at a date to be determined, pending receipt of medical information.

Scott, who lives in Alexandria, Va., and Pereira, who lives in North Beach, Md., entered Alford pleas - in which they did not admit guilt but did acknowledge that the State had sufficient evidence to convict them - after five weeks of testimony and on the eve of the case going to the jury. Goodman, who also lives in Alexandria, Va., pleaded guilty on the first day of his January trial. His plea was pursuant to a cooperation agreement in which he agreed to testify against his co-defendants.

In the trial, 25 victims testified to an elaborate scheme run by the defendants out of their Camp Springs, Md. coin and stamp store called Goldies. Promising returns of 15% and above, the defendants sold "interests" in two investment "accounts".

The first, called the Fifteen Per Cent Account, was supposed to be an investment in valuable coin estates, on which Goldies promised a guaranteed 15% return. The second investment, called the Stock Account, involved the buying and selling of stocks, particularly initial public offerings. Despite the glowing reports of profits and handsome returns paid out to some investors, the investments were not made as promised.

"In the five years that the scheme was in operation, 1990 to 1995, fewer than five coin estates were purchased by Goldies," General Curran said. "Similarly, little of the promised stock was actually purchased and that which was lost money. Investor's money was instead used to pay off earlier investors and to finance the defendants' lavish lifestyles, which included frequent gambling junkets to Atlantic City, Las Vegas and local casinos."

Although the defendants took in over $8 million in investor funds, by the time Goldies went into bankruptcy in late 1995, it had less than $100,000 in coin and stamp inventory and stock holdings of less than $400,000.

Author Tom Clancy invested well over $1 million in both Goldies Accounts. Other victims included doctors, psychologists, a carpenter, a bartender, government workers and retired military personnel.

At the sentencing hearing today, evidence was presented of Scott's declining health, due to the ravages of diabetes, liver and kidney failure, congestive heart failure and poor circulation. Because of his poor health, the trial, which was originally scheduled for June of last year, had to be postponed to January of this year. All parties agreed that his health has declined since completion of the trial, which is why the court wanted additional medical information.